Advances in Economics and Business Vol. 3(10), pp. 455 - 464
DOI: 10.13189/aeb.2015.031005
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Knowledge Externalities: An Application to the Turkish Manufacturing Industry

Huseyin Dastan *, Hasan Gunes , Gurkan Calmasur
Faculty of Economics and Administrative Sciences, Erzurum Technical University, Turkey


In the sequel of technological breakthroughs as advanced in recent years, the notion of mileage have started to eradicate on Earth. Created knowledge and innovations disseminate along distinct people or institutions promptly. Fast paced technological advancements of communication and attaining have brought countries closer so as to transform the world to a, so to say, "global village". In this new world's order, where economical and social circumscriptions fade out gradually, the economy shall be undertaken as an entirety as circumscriptions are being glossed over. Knowledge and innovations of a company which the same are created by disseminate promptly in the new world's order which is being unfold, and introduce positive influences to the other companies and industries. The influences, here concerned are, observed on the closely positioned companies and industries along with the ones so remotely positioned to each other. In this study, the presence of a limited number of studies on externalities taking place in the Turkish manufacturing industry, the importance of externalities, will be a related topic aimed to generate resources for research. In line with this idea and with consider to NACE Rev.2 classification, knowledge externalities that arise in Turkish manufacturing industry are analyzed for the entirety of the industry and for each sub-sector distinctively within the 2003-2013 years of period. With regard to the test results of GMM estimator, where the tests were conducted separately for each of the sub-sectors of manufacturing industry; MAR, Jacobs, Porter, and III variable might have both positive and negative influences. MAR knowledge externalities (resulting from specialization) were probed to be meaningful in 9 sectors; whereas Jacobs's (resulting from diversity) in 7 sectors, and Porter's (resulting from competition) in 6 sub-sectors of the manufacturing industry. Also, III variable (resulting from innovation) was proved to be meaningful for the 9 sub-sectors of the manufacturing industry.

Knowledge Externalities, MAR, Jacobs, Porter, Turkish Manufacturing Industry, GMM

Cite this paper
Huseyin Dastan , Hasan Gunes , Gurkan Calmasur . "Knowledge Externalities: An Application to the Turkish Manufacturing Industry." Advances in Economics and Business 3.10 (2015) 455 - 464. doi: 10.13189/aeb.2015.031005.